The problems around payday lending on the Island are largely perception rather than reality.

That's the conclusion of a report by the Office of Fair Trading into how payday loans affect Manx consumers.

The OFT carried out a public survey to try and hear first-hand experiences from those who had taken out such a loan, from an Isle of Man lender, via a UK website or even from an illegal loan shark.

However, there was little uptake, with just 15 people actually completing the survey.

Whilst appreciating that people can be reluctant to talk about financial problems, the OFT believes numbers would have been much higher if there was a significant problem.

The report says there's little evidence to suggest local lenders are acting irresponsibly and overall they are behaving much better than their UK counterparts.

Those on the Island who choose to use services provided by UK loan websites can be subject to bad practice, but the OFT feels it would not be in the best interests of IOM consumers to prevent UK lenders from operating in the Island market until the UK government has finished its own review into the industry.

The report concludes there is no evidence to support a need for upgraded regulation for local moneylenders.

The OFT says it is currently investigating an alleged illegal moneylender on the Island, and whilst there's no evidence of a widespread problem, it would be naive to believe that this is the only such illegal operator on the Island.